Trading book: Difference between revisions
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*Hedging risks arising from any of these activities. | *Hedging risks arising from any of these activities. | ||
The trading book is distinguished from the banking book. | |||
The banking book includes all instruments which are not in the trading book. | The banking book includes all instruments which are not in the trading book. | ||
Revision as of 10:21, 24 August 2016
Bank supervision - capital adequacy.
For capital adequacy calculation purposes, a bank's trading book includes any instruments which are held for any one or more of:
- Short term resale.
- Profiting from short term price movements.
- Locking in arbitrage profits.
- Hedging risks arising from any of these activities.
The trading book is distinguished from the banking book.
The banking book includes all instruments which are not in the trading book.
